WIS investigation finds 8 towns owe state $1.4 million

Bonneau clerk of court Liz Wrenn says she made a decision to spend court fines and fees on "salaries and payroll" instead of sending that money to the state. Wrenn admitted knowing it was a violation of state law for the town to spend the funds.

Cottageville clerk of court Sandy Cox tells WIS the treasurer's office information regarding what the town owes is "wrong." Cox admits the town hasn't remitted every month, but blames the unpaid fines and fees on a "previous administration."

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COLUMBIA, SC (WIS) -

Eight towns collectively owe the state over $1.4 million in unpaid court fines and fees, a months-long investigation by WIS shows.

The delinquent towns were uncovered after a WIS speeding ticket investigation in Turbeville.

For every municipal traffic and court conviction, the state requires a defendant to pay a fine, fees and court costs. A portion of those fines and fees are retained by the town that prosecuted the case while the remaining is turned over to the state treasurer's office.

The municipal or county court clerk is required by law to send monthly payments to the treasurer's office for the state's portion of the fines and fees collected. The state's portion is then divided up among several state public safety agencies.

Assessments from state municipal courts have dropped by $2.5 million in the past five years, according to online records from the treasurer's office. During the last fiscal year, towns sent nearly $22 million in court fines and fees to the state which is down from $24.7 million paid during the '07-‘08 fiscal year.

The reductions have caused negative impacts to public safety agencies that depend on local and state revenue, officials said.

WIS went to the state treasurer's office to find out which courts still owe payments to the state. Two months later, the treasurer's office provided a list of municipalities who owe the state money but, they were unable to provide how much was owed.

A WIS analysis of the treasurer's records showed eight towns owe the state around $1.4 million. No county or state courts were delinquent in payments, records show.

SC POLICE ACADEMY, CRIME VICTIM CRISIS

Since 2008, the state's police academy lost nearly $1 million in revenues produced by convictions in the state's courtrooms, SC Criminal Justice Academy Deputy Director Mike Lanier said.

Each year, the academy, which had been deemed one of the best in the nation, trains and certifies the state's police officers based on the revenues the state collects from court convictions. But with the decrease in revenues, academy leaders tell WIS, South Carolina public safety may pay a price.

"Our concern is we don't know where the floor is," said Lanier who handles the academy's finances. "How much further will it drop?"

Lanier and academy director Hubert Harrell went to the State Capitol in January to warn lawmakers, something in the state's fine remittance system is broken.

Lanier said he's not sure why the fines and fees are dropping off.

"It may be a number of reasons why the money's falling off, but you really can't address it until you identify it," Lanier said.

Harrell said he's afraid if the state doesn't do something to force courts to turn the assessments over, he'll have to cut staff and training.

"We will regress and there's no getting around it," Harrell told WIS.

When asked if they were able to identify the drop in funding, Harrell replied ""No, none at all."

In March, WIS filed a request with the state treasurer's office, asking for a list of which courts owed the state. In July, the treasurer's office provided a list of eight towns that are delinquent with monthly remittances and some that have not turned in annual audits; both of which are required by law.

State Treasurer Curtis Loftis, who was elected in 2010, said he wasn't aware eight towns owe money to the state.

"Well, I haven't looked at the records recently," Loftis said. "When I came into office, I completely remodeled the program and so, we're catching up."

The town of Cottageville in Colleton County owed $775,180, records show.

Loftis told WIS, he has no way of collecting the money from Cottageville, except for withholding the town's annual allotment of state funding.

"Look, $400,000 is a lot of money where I come from," State Office of Victim's Assistance (SOVA) Director Larry Barker told WIS.

Barker's said his agency's lost nearly $1 million in the past two years because of a drop in the state's court fines and fees and were force to find ways to make up for the shortfall.

SOVA staffers have negotiated with hospitals and doctors across the state to perform medical services at a highly reduced rate, and then those medical service providers agreed to write off the remainder of what's owed, Barker said.

Plus, SOVA relies on federal tax dollars earmarked for crime victims to fill gaps South Carolina towns are causing by not remitting fines and fees.

"Could SOVA operate without this money?" Barr asked. "Oh no, no, no It would be devastating," Barker said, "There's no way we could."

It's the same story for the state's police academy. If the losses continue, Harrell said the academy and the state's public safety community could be in trouble.

It's a problem and the legislature needs fix it, Harrell said.

"We were the guy hollering wolf in the middle of the night out there in the forest, you know," Harrell said. "We said ‘hey, look, he's here, he's here.' Now, it's up to those guys to look and see what they can do to figure out what the problem is. Bubba's gone and we have a whole new face of law enforcement here in this state. If we have to regress, I just feel sorry for our state if we allow it."

TOWNS FOUND DELIQUENT

A WIS investigation found eight municipalities have not complied with state law when it comes to paying the state's court fines and fees.

Cottageville's Police Department writes thousands of tickets each year. A portion of the tickets and convictions the town issues is required to go back to the state treasurer's office and then distributed to public safety agencies.

COTTAGEVILLE

Cottageville has only paid $10,616 to the state since Jan. 2009 even though they owe $775,180 according to records provided by the treasurer's office.

The treasurer continues to provide the town with 75 percent of its share of state tax dollars, despite the outstanding fines and fees owed to the state.

WIS went to Cottageville and spoke with municipal clerk Sandy Cox, who said she took over the town's court system in 2010.

Cox said she wasn't the one who made the call as to how the assessments were spent and wasn't aware their fees weren't being turned over to the state

Cox said she's sent remittance forms to the treasurer's office every month since she took office, but records show only one payment since Jan. 2009.

"I don't know where you're getting your information from," Cox said, "Well, they're wrong. I pay every month, every month I remit. I mean, there have been a few months that I haven't, but for 90 percent of the time I've been here, I have been remitting it."

TIMMONSVILLE

About 18 months ago, the Florence County town of Timmonsville disbanded its police force and closed the doors on its municipal court.

State records show Timmonsville officials have not reported fines and fee collections to the treasurer's office in 28 months, long before the town decided to shut its criminal justice system down.

The treasurer's office could not provide WIS with an estimate of how much the town owes, but did provide records to show the town's last payment was $8,541 which was paid in April 2012. Since May 2011, Timmonsville failed to send assessment forms to the state.

Based on the last payment, it's estimated the town owes the state $119,583.

Bines took over the town one month after Timmonsville closed its criminal justice systems.

Bines said he did not know about the money the town owes the state, but later said she was "working diligently" with the treasurer's office.

"Do you all intend to follow up with the treasurer's office to make sure what's owed is paid?" Barr asked. "Of course we will and we have been following up with the treasurer's office," Bines said. "But I'm not aware of that so I can't make any comment on those statements you just asked."

Loftis issued a statement to WIS regarding the Timmonsville delinquency saying "Ninety percent of the municipalities in South Carolina pay on time and are compliant with the law. The ten percent who are not compliant must pay the consequences. As treasurer, my office is holding these towns accountable and doing so in a transparent way in order to protect the people's money. I've ordered the State Auditor to audit the financial records of Timmonsville and to report his findings back to me for consideration of further action."

RIDGEVILLE

The town of Ridgeville, just a few miles away from Summerville, fired its town clerk in 2011 after they were penalized by the treasurer's office due to a 2011 audit of the town's court fines and fees.

Due to the audit, the town faced a 25 percent reduction in tax dollars from the state.

Based on the town's own records, the state couldn't determine what the town collected in court fines and fees to estimate what it owes the state.

"Do you know how much you owe the state?" Barr asked Ridgeville Mayor James Williams. "I sure don't," Williams said.

Williams said he didn't know what the town owed the state and that was a good thing for Ridgeville.

"Well, because if they don't know, it's their job to find out, that's all I can say," Williams said as he stood inside the town clerk's office.

BONNEAU

The town of Bonneau, a small town along Highway 52 near Monks Corner, is delinquent in turning in its 2011 audit.

A WIS estimate shows the town owes the state $160,000. The town has not sent its court fines and fees to the state since 2009, according to the treasurer's office. Those same records show the Bonneau clerk of court Liz Wrenn sent in a payment of $16,008 in July 2013 for court fines and fees collected in Aug. and Sept. 2012.

The town is required, by law, to remit its fines and fee collections to the state each month.

"It was between paying payroll, meeting payroll and paying this," Wrenn told WIS during a Sept. 5 visit to her office at town hall.

"So, basically the town was, the fines and fees that were supposed to go to the state, the town was spending that?" Barr asked Wrenn. "Well, we were paying our salaries and stuff," Wrenn said.

"Who made the decision to pay, instead of sending that money back to the state, to pay the town's debts?" Barr asked. "I did," Wrenn said.

Wrenn disputed the treasurer's office records that show Bonneau missed 20 months of payments since 2009. Wrenn did have copies of the remittances the treasurer's office showed the town turned in with the $16,008.90 payment in July.

The town built a new town hall in the last few years, has a fire department and a fully staffed police department which has won dozens of awards for driving under the influence enforcement from the SC Department of Public Safety.

Wrenn told WIS, the town survives off the ticket revenues its police department issues, revenues the town is supposed to be turning over to the state.

"Now they're charging us and if they go for a class, they're charging us for a meal," Wrenn told Barr as she shuffled through her court fines and fees remittances. "Do you know why they're charging?" Barr asked. "Because they don't have the money," Wrenn replied.

"Do you know why they don't have the money?" Barr asked. "Same thing for us," Wrenn said. "It's because this isn't being sent in is what the academy is telling us," Barr said. "Listen to me, this is a small town," Wrenn responded.

SELLERS

The Marion County town of Sellers owes around $184,300 to the state, based on a WIS investigation. State records show, Sellers turned in one payment form since 2009; the period of time our analysis covered.

Records show Sellers turned in a $6,354 payment in Feb. 2013 for Nov. and Dec. 2012. The treasurer's records do not show any other remittances between 2009 and now.

WIS went to Sellers on Sept. 5, but could not get an answer from town officials. Calls to town officials continue to remain unanswered.

CLIO

Records show the Marlboro County town of Clio owes the state $19,723. Clio has not submitted a mandatory annual audit of the town's finances and court fines and fees since 2008, according to a WIS analysis. Based on the treasurer's records, Clio submitted a $2,076 payment in May 2012 to cover fines and fees collected in Nov. 2011 and Feb. 2012.

Clio's mayor and town administrator told WIS, they're waiting on a Columbia accounting firm to finish four years worth of audits so they can be turned in to the state. As of this report, those audits and the fines and fees are delinquent.

WHERE'S THE ENFORCEMENT?

"It's not right that some towns keep this money for themselves and the others send it in as required by law," Loftis said in response to a question regarding Bonneau's decision to spend court fines and fees on town business.

As the laws are now, Loftis' office is limited in what it can do to force towns to pay. Aside from withholding state tax dollars from these municipalities, Loftis said the law doesn't allow any more authority outside of conducting a state-level audit.

It's that lack of enforcement power, Loftis said, that's allowing towns across the state to keep these assessments and spend it as they please.

"What is the treasurer's office doing to contact each of these to find out where the remittance forms are and number two, where is the money?" Barr asked Loftis.

"We ask a lot of questions," Loftis said. "I don't have subpoena power and that's a real problem. I can't make them do things they don't want to. I can't make them tell me things and this really leads to a bigger problem in South Carolina. We don't investigate white collar crime like people think."

Loftis' office also has a tough time estimating how much a particular court owes because it's up to each court to keep an accurate accounting of what's collected, then accurately report that to the state. If a clerk isn't doing that, it's a guess as to what's owed.

When towns ignore the state requirement to submit annual audits and monthly court fines and fees assessments, Loftis said he thinks that's a signal that something may be wrong.

"It's definitely a red flag and I think it warrants a closer look," Loftis said.

"When a municipality does not send that money to the state of South Carolina are they cheating the people of South Carolina?" Barr asked. "It's not a good situation. We all have to pay taxes, we all have to pay fines and fees; whether we like it or not and so, you just can't pick and choose, you have to pay your fair share," Loftis said.

Loftis told WIS, he's already requested state auditors to conduct a full-scale audit of the town of Timmonsville which could turn up evidence which would be forwarded to law enforcement.

"If the folks who owe this money knew on the backend the impacts they're causing across this state for not paying it, do you think that would change some conduct, change some minds?" Barr asked Loftis. "I used to always think I could understand that. People just look at things from their own perspective and if you're the court clerk of a small town, the most important thing to you is to make sure the policeman gets paid because maybe you've only got one," Loftis said, " I'm not saying they made the right or wrong decision. I'm saying they really didn't have that option. They have to send this money in by law."

Loftis said he plans to lobby the legislature in the upcoming session for more enforcement powers for the treasurer's office, in hopes of upping the collection rates of the court systems that owe the state.

For now, the fines and fees many of the delinquent towns collect is far greater than the state funding they receive, which offers towns no incentive to pay, Loftis said.

An investigation into a speeding ticketing scheme has turned up another problem with the way state court fines are collected and what those dollars pay for. Several towns collectively, owe tax payers an estimated $1.4M.More >>

A months-long investigation into a speeding ticketing scheme in Turbeville has turned up another problem with the way South Carolina court fines are collected and what those dollars pay for. Our investigation discovered several towns that, collectively, owe tax payers an estimated $1.4 million. More >>